N.M. Stat. § 51-1-46

A. There is created the “local public body unemployment compensation reserve fund.” The fund and any income from the fund shall be held in trust, deposited in a segregated account and invested by the general services department with the prior approval of the state board of finance. Money in the fund is hereby appropriated to carry out the purposes of the fund.

B. Any local public body of this state may participate in the local public body unemployment compensation reserve fund by:

(1) giving notice to the director of the risk management division at least ninety days prior to the date participation is to begin; and

(2) agreeing to pay at the end of each calendar quarter an amount determined pursuant to the rate schedule prescribed by the risk management division plus such additional amount as may be necessary to pay reasonable costs of administration.

C. The director of the risk management division shall terminate the participation of any local public body in the local public body unemployment compensation reserve fund if the local public body fails to:

(1) pay any assessment made by the risk management division within thirty days after the date of assessment; or

(2) comply with regulations of the risk management division.

D. Money deposited in the local public body unemployment compensation reserve fund may be used by the director of the risk management division to:

(1) reimburse the department for benefits paid to public employees covered under the local public body unemployment compensation reserve fund during the previous calendar quarter;

(2) pay any costs or expenses incurred in protesting benefits paid by the department;

(3) pay any costs and expenses incurred in carrying out the provisions of this section; and

(4) establish and maintain a reserve fund for paying reimbursements of benefits paid to employees of local public bodies.